Notes for unit 3; the Law of sale. Includes; contract of sale, obligations of the parties, the risk rule, the passing of ownership and all relevant subsections for the above mentioned.
A contract of sale is a reciprocal agreement in terms of which the seller
undertakes to deliver the thing being sold and all his right to it to the buyer;
and the buyer, in exchange, undertakes to pay a sum of money to the seller.
4 essentialia (distinguishing characteristics) are derived from definition:
1. The contract of sale is a reciprocal agreement
2. The sale deals with a thing and the rights thereto. (thing that is sold = the
merx)
3. The subject-matter and its rights should be delivered to the buyer .
4. The purchaser must pay a sum of money for the thing.
★ Parties may add further provisions as long as they are not in conflict with the
above essentialia
GENERAL PRINCIPLES
The general principles of a contract law applicable to all contracts also apply to the
contract of sale , namely:
1) Agreement on the nature of the contract, the price of goods
2) Legal capacity of both the buyer and seller
3) Formalities (E.g. writing as required by law or by the parties themselves)
4) Legality → performance must be physically executable (e.g. you may not sell
a human)
5) Possibility → Performance must be physically executable (e.g. you may not
sell the orange river)
6) Certainty → The thing sold must be certain or ascertainable
, THE SUBJECT-MATTER OF THE SALE
● The subject matter of a sale can be anything
Examples:
➔ Movable or immovable things
➔ Corporeal (tangible) things or incorporeal (intangible) things
➔ Future things
➔ Res aliena (things that belong to someone else)
Our law does not require that the seller has to be the owner of goods for the
contract to be valid.
➔ The seller only has to provide the buyer with undisturbed possession.
➔ In order to transfer ownership → important for seller to be owner.
THE PURCHASE PRICE
● The basic requirement for price is that there must be agreement on the
purchase price, which means that the price should be certain or ascertainable
by means of an external standard.
The price has to be:
● Payable in money.
○ If counter-performance consists partly of money and partly of
something else (e.g. services) → the intention of parties would be the
deciding factor.
○ If main consideration of performance is in the form of money, or the
same value as the other type of performance → assumed that intention
was to conclude a sale.
● Real
○ (i.e. relate to the value of the goods and not amount to a stipulated
transaction / donation)
● Certain
○ Criterion = the price should be determined, or the price should be
ascertainable (e.g. a price per unit)
● A “reasonable” or “fair” price will not suffice as that is not a certain or
ascertainable price.
● It may be the “usual” price, because that is an ascertainable price
○ (e.g. when an item is not priced)
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through EFT, credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying this summary from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller juliayates19. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy this summary for R100,00. You're not tied to anything after your purchase.
